The financial guru’s scary warning to investors hoping to make money at the end of lockdowns and reopening of borders – and the stock he says you MUST avoid
- Financial guru Phil King has warned investors about hasty decisions after lockdown
- Many investors see the Flight Center as a ‘safe’ option as borders finally reopen
- King completely disagrees, pointing to mass closures of national stores by 2020
- Most travel companies and video teleconferencing should also be avoided
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A financial guru has issued a scary warning to investors looking to redeem their shares after lockdown as borders begin to reopen across Australia and abroad.
Phil King, co-founder of Regal Funds Management, also revealed which stocks he believes should be avoided.
A well-known company was stuck in his binoculars, the largest reseller of travel in Australia – Flight Center.
He points to many people now booking their travels online instead of in-store, and the slow business recovery following the pandemic, and he is convinced that shares in Flight Center are set to fall.
Despite a current level of close to $ 17.33, Mr. King award as ‘short’, a common economic term for cheating, reported The Australian.
Financial guru Phil King, co-founder of Regal Funds Management, is convinced that Flight Center is a retail stock that people should avoid after lockdown in Australia
Flight Center has proven to be a popular stock for countless retail investors – but King believes that will change.
He predicted an uneven road ahead for Flight Center and potentially other travel companies, despite the fact that international borders are now slowly reopening.
He said the Flight Center had relied on $ 800 million in convertible banknotes to stay afloat after closing countless stores due to Covid-19 by 2020.
In the long run, it is expected that they will be converted into stocks, and if stock prices fall, Flight Center will have to come up with the $ 800 million to avoid going under.
Another factor is that many travelers now choose to trade directly with airlines for their reservations abroad.
Financial guru Phil King also believes that Flight Center has failed to adapt to a digital world compared to many of its business rivals
“The Flight Center was already facing a lot of difficulties before Covid-19,” King said.
‘It has (also) been slower than many other travel agencies to migrate to a digital world.’
Another stock King said investors should bypass is the global video teleconferencing software program Zoom.
Originally a market favorite in 2020, as the world adapted to work externally in many sectors, its long-term future is also said to be uncertain economically.
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Source: MF and Co Asset Management